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Duke, the rural county's largest taxpayer, will drop its lawsuits against the county in exchange for lower property appraisals and tax bills.

Arguing Citrus had overvalued its power plant and other holdings, Duke paid only $41 million of its $96 million in county property taxes over the past two years. As part of a settlement, Duke will pay Citrus $7.5 million more.

The holdout by Duke, which once funded 25 percent of Citrus' property tax rolls, sparked a fiscal emergency in the rustic gulf-front county of 140,000 about 65 miles north of St. Petersburg.

The county last year raised homeowners' tax rate by 27 percent, costing a resident owning a $100,000 home about $13 a year. The plunge also opened a sudden chasm in public budgets: Citrus schools have in three years lost $10 million as a result of lower-than-anticipated tax revenue, School Board records show.

Citrus officials said they agreed to settle because of rising legal bills in their battle with Duke, the largest power company in the country. The county had already spent $1.4 million preparing for trial scheduled for May.

County officials also underlined weaknesses in their own case, pointing to opposition from the state Department of Revenue, a disconnect from how other counties appraise property and early resistance in the courts.

A judge in November agreed with Duke that a pollution-control system the county had appraised at market value should have instead been marked as salvage, undermining one of the county's core arguments.

Even a successful trial, officials said, would have likely brought with it a lengthy, pricey appeal, with no immediate revenue, promise of success or end in sight.

"It was a difficult decision," Citrus County property appraiser Les Cook said Thursday, "but I had to look at what was legally supportable."

Duke first refused to pay its tax bill in November 2012, three months before announcing the closure of its CR3 nuclear plant. A botched repair attempt there transformed the plant, which helped make Duke into Citrus' largest private employer, into a giant paperweight.

The North Carolina-based utility's property in Citrus will be valued this year at $1.3 billion, a full $1 billion below the county's appraisal in 2012. An independent appraiser hired by Citrus last year suggested it had an even higher value, about $3.4 billion.

Cook was appointed property appraiser by Gov. Rick Scott in January after the death of Geoffrey Greene, who had spearheaded the county's legal battle.

Duke spokeswoman Nicole LeBeau said the utility appreciated "the cooperative efforts" with Cook and "looked forward to continuing to be an instrumental part of this community."